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8 TZL: Zweig Group research shows there has been a shift in business development strategies. More and more, technical staff, not marketing staff, are responsible for BD. What’s the BD formula in your firm? SM: Our business development culture is strongly aligned to the seller-doer model, and always has been. As with any firm using this approach, the challenge is keeping the BD flywheel moving during the busy times, particularly when trying to grow into new markets and geography with new clients. We watch this situation closely and are working to develop better forecasting tools that our leaders can use to ensure the pipeline is full and filling at all times. With a sell- er-doer model, formal and informal BD training is key. We are working to make improvements in this area. CONFERENCE CALL, from page 7 “We message the importance of working cooperatively to a client’s benefit, and have incentive/bonus programs that weigh company financial performance much more strongly than any group performance.” TZL: Diversifying the portfolio is never a bad thing. What are the most recent steps you’ve taken to broaden your revenue streams? SM: As a full-service engineering, surveying, planning, and environmental consulting firm, we’ve always embraced and encouraged a diverse portfolio of clients, markets, and ser- vices. Recent firm acquisitions in Wyoming communities brought additional geographic diversity, and are allowing us to expand from the three to four service-lines these firms operated in to the broader full-market capabilities of our entire team. We’re winning work in Wyoming that would have been unlikely before, and we’re finding client-welcom- ing opportunities for our buildings group and other mar- kets. TZL: What is the role of entrepreneurship in your firm? SM: It’s vital to our success. For some employees, their role is outward focused with efforts to grow the business in existing/new markets. For others it might mean creat- ing greater efficiencies in how we deliver services, internal- ly and externally. For everyone, it means looking to create more valuable and memorable client experiences every day. In a classic entrepreneurial sense, our industrial market group is a great example. Created only a few years ago, its genesis was the identification of a niche we could fill for large industrial and mining organizations that require full- service engineering, surveying, and environmental partner- ships on projects at existing sites. These projects are typi- cally of substantial size to our firm, but perhaps not so for large consulting firms with a national footprint. The indus- trial/mining organizations we work with get a level of ser- vice from us that they don’t always see from these national firms which have trouble being as nimble and responsive. Our industrial market group is one of our fastest growing and most profitable.

TZL: In the next couple of years, what A/E segments will heat up, and which ones will cool down? SM: Making bold predictions is a fool’s game in my experi- ence. General economic indicators remain positive and so we’re planning for all of our current market segments to re- main strong for the next six to 12 months. I’m more con- cerned about how to plan and react to unfolding events. We’re thinking more about scenario planning and less about predictions. The next recession likely won’t be triggered in the same way as the last one, but we’re better prepared to react now. TZL: Measuring the effectiveness of marketing is diffi- cult to do using hard metrics for ROI. How do you evalu- ate the success/failure of your firm’s marketing efforts when results could take months, or even years, to mate- rialize? Do you track any metrics to guide your market- ing plan? SM: We’ve typically tracked our success rates on some of our business development efforts, but that is a far cry from tracking marketing success. More recently, we’ve been working on development of a balanced scorecard. Within the customer perspective of this effort, we’ve been working to identify, and begin tracking, some metrics that we antici- pate will help us measure the effectiveness of our marketing and external communications efforts. Check back with me in a year or two; I may have a different perspective on this question. TZL: They say failure is a great teacher. What’s the big- gest lesson you’ve had to learn the hard way? SM: We were slow to react during the Great Recession, par- ticularly as it played out in different ways and at different speeds in our upper Rockies and southwest locations. A strong balance sheet and cash position as we headed into the recession were significant buffers to a need to react quickly to a declining backlog and revenue. As an organiza- tion that prided itself on not being a “hire and fire firm,” we took too long to act in retrenching and retooling our staff- ing mix, market capabilities, and geographic locations. Go- ing forward, we’re purposefully more diverse in our service offerings in each geographic location and have better tools in place for managing our business. TZL: Do you use historical performance data or metrics to establish project billable hours and how does the type of contract play into determining the project budget? SM: For most projects, historical performance data serves either as the starting point, or as an important “check and adjust” step for establishing project budgets. In either case, a tight scope of work tailored to the needs of each client is essential for budget success. We encourage project manag- ers to use our ERP system to divide work scope into man- ageable tasks, with assigned budgets, so that actual perfor- mance can be tracked on current efforts, and used to help establish budgets for subsequent projects. Tightly scoped lump sum project contracts are our preference, but many of our public clients are precluded from using this approach due to funding constraints or administrative rules. In the end, any type of contract can be successful if paired with a proper scope, a budget that effectively addresses risks and a project manager adept at dealing with inevitable change.

THE ZWEIG LETTER October 22, 2018, ISSUE 1269

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